Oil company profits

Oil companies are enjoying record profits and consumers are enjoying paying rediculously high prices for gasoline. There is far less competition in the oil industry today than there was when John D. Rockefeller’s Standard Oil Company was convicted of anti-trust violations.

It is interesting that the two biggest parts of Standard Oil, namely what is now Exxon and what was Mobil have been remerged. We hear not a peep from our Attorney General. Sadly, we live in times when corporate America rules the roost and pretty much does as they please and directs their own traffic in Washington. We have neither a level playing field nor any kind of self-policing going on.

I demand that Congress do something. A Windfall Profits Tax would be a good idea to begin with, followed by an in-depth investigation into price manipulation by the large companies. Someone in Washington needs to stand up and take on these big fellows and it needs to happen soon.

I say this having been someone who worked in the oil business for nearly 30 years. The situation has gotten way out of hand and an investigation is long, long overdue.

Politicians get a lot of play by standing up for Joe. The Windfall Profits Tax was on the books for the better part of the ’80s, and Congress has often attempted to revive it. While the House, regardless of its motives, was economically laudable in reducing subsidies to the oil industry in January, an excise tax on Big Oil’s excessive profits has no such leg to stand on.
Perhaps you disagree with me that a windfall profit tax would reduce output and consequently raise prices for consumers. Fine. We’ll charge ahead with our taxation scheme. If I were to give you an anonymous list of some leading American companies, you could spot the price-gouger, right?
Let’s proceed with a game I’d like to call … Pick the Profiteer! Your choice will indicate the industry that’s clearly making more than its fair share. We’ll tax those excess profits to subsidize the unreasonable prices that consumers pay for the industry’s products. Sound good? Here are your choices:
So who is making all that money per dollar?
Gross
Margin Net
Margin Return on
Assets Return on
Capital Company
Company A
31.7% 12.9% 14.1% 21.9%
Apple
Company B 49.2% 18.6% 14.9% 23.4% 3M
Company C 65.6% 21% 14% 19.3% Coca-Cola
Company D 32.8% 9.5% 14.4% 23.9% Chevron
Company E 28.9% 6.5% 16.5% 64.3% Accenture
All data courtesy of Capital IQ, a division of Standard & Poor’s. Data reflects trailing-12-month performance, with the exception of the final column. Free cash flow amounts are unlevered.

rory

First you should go after coke, they make MUCH MORE per dollar than the ‘evil’ oil companies:

Politicians get a lot of play by standing up for Joe. The Windfall Profits Tax was on the books for the better part of the ’80s, and Congress has often attempted to revive it. While the House, regardless of its motives, was economically laudable in reducing subsidies to the oil industry in January, an excise tax on Big Oil’s excessive profits has no such leg to stand on.
Perhaps you disagree with me that a windfall profit tax would reduce output and consequently raise prices for consumers. Fine. We’ll charge ahead with our taxation scheme. If I were to give you an anonymous list of some leading American companies, you could spot the price-gouger, right?
Let’s proceed with a game I’d like to call … Pick the Profiteer! Your choice will indicate the industry that’s clearly making more than its fair share. We’ll tax those excess profits to subsidize the unreasonable prices that consumers pay for the industry’s products. Sound good? Here are your choices:
So who is making all that money per dollar?
Gross
Margin Net
Margin Return on
Assets Return on
Capital Company
Company A
31.7% 12.9% 14.1% 21.9%
Apple
Company B 49.2% 18.6% 14.9% 23.4% 3M
Company C 65.6% 21% 14% 19.3% Coca-Cola
Company D 32.8% 9.5% 14.4% 23.9% Chevron
Company E 28.9% 6.5% 16.5% 64.3% Accenture
All data courtesy of Capital IQ, a division of Standard & Poor’s. Data reflects trailing-12-month performance, with the exception of the final column. Free cash flow amounts are unlevered.

Pauly

What rory did was a typical republican bate and switch debating tactic. Find a similar point and draw the attention away from the subject matter. Sadly enough, he completely cut and pasted his posting. Another trait of the far rightâ€¦lack of imagination.

Letâ€™s see if we can get this straight. Coke (or any soda) and bottled water cost a lot more per gallon that gas, and this is supposed to excuse the fact that it has become a monopoly industry with the direct help of this administration. Iâ€™m sorry rory, but I can go the rest of my life without ever buying another coke or bottled water. Because they are luxury items. How long can you go without gas? I know truckers who would agree with me.

Pauly

What rory did was a typical republican bate and switch debating tactic. Find a similar point and draw the attention away from the subject matter. Sadly enough, he completely cut and pasted his posting. Another trait of the far rightâ€¦lack of imagination.

Letâ€™s see if we can get this straight. Coke (or any soda) and bottled water cost a lot more per gallon that gas, and this is supposed to excuse the fact that it has become a monopoly industry with the direct help of this administration. Iâ€™m sorry rory, but I can go the rest of my life without ever buying another coke or bottled water. Because they are luxury items. How long can you go without gas? I know truckers who would agree with me.

Vincent Carroll is The Denver Post's editorial page editor. He has been writing commentary on politics and public policy in Colorado since 1982 and was originally with the Rocky Mountain News, where he was also editor of the editorial pages until that newspaper gave up the ghost in 2009.

Guidelines: The Post welcomes letters up to 150 words on topics of general interest. Letters must include full name, home address, day and evening phone numbers, and may be edited for length, grammar and accuracy.

To reach the Denver Post editorial page by phone: 303-954-1331

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